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Floating Rate Fixed Deposits: How They Offer Protection Against Inflation
- Location: India
A floating rate FD offers interest rates that are linked to market benchmarks, such as the Marginal Cost of Fund-based Lending Rate (MCLR) or the repo rate. Unlike fixed-rate FDs, where the interest remains constant throughout the tenure, floating-rate FDs adjust periodically, reflecting changes in market interest rates. This can be beneficial in a rising interest rate environment, as your returns increase accordingly.
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